Appraisers will have varying viewpoints to some extent on the value of a property after a fire or in claiming casualty losses on income tax returns. In general, however, they use the same factors in their decision making processes.
Here are some tips from a real estate appraiser in Napa County, CA about considerations you should keep in mind when determining the value of your property after a fire.
Determining the value of personal items
The loss of personal goods in your home in a fire can be difficult to reasonably quantify. It can be challenging for people to separate the sentimental value of an item from the objective measures that determine its actual monetary value that you will use as a common ground for discussion with the Internal Revenue Service and your insurance provider.
However, there are some objective measures you can consider, including:
- Cost when purchased: The amount of money you initially paid for an item is important to know, as it will help establish the final value of the item after damage and depreciation. Any receipts you have for items in your home will be of great use to appraisers and evaluators.
- Fair market value before the fire: Occasionally this concept is also referred to as “actual cash value.” This is defined as the amount of money you would have fairly received for the item had you sold it the day before the fire occurred. This price is determined by the cost when purchased minus the wear and general depreciation it sustained since purchase. For some types of assets, it is easier to calculate depreciation than others because there is a general standard and process for doing so. Cars, for example, are likely easier to calculate actual cash value and depreciation than other, smaller items in your home, or items that are particularly unique.
- Value after the fire: This value is occasionally referred to as “salvage value.” It will take into account the cost when purchased and actual cash value, as well as the condition the item is in after the fire.
Restoration services play a role
The value of your home will play a role in the kinds of restoration services you need, and vice versa. There are many companies that specialize in restoring fire-damaged buildings. It is important to make sure you perform a thorough background check before retaining one of these companies, as unfortunately many post-disaster contractors prey on people who are desperate for assistance.
Examples of restoration services include preventing further damage, estimating structural damage, making repairs to structural damage, packing and storing household items, securing cleaning and repair subcontractors and estimating the costs of repairing or renewing personal property items.
For more information about the factors you will need to consider when attempting to determine the value of your home after it has been damaged by a fire, we encourage you to contact a skilled real estate appraiser in Napa County, CA. Learn more by reaching out to County Appraisals Inc. today!
Categorised in: Real Estate Appraisals
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